Health and environmental consciousness effects of wealth in low income countries: evidence from households' energy, water, and sanitation services consumption in Burkina Faso

This paper relies on random utility theory and households' consumption choices on cooking fuel, drinking water, and sanitation from the 2014 US Agency for International Development's Demographic and Health Survey data on Burkina Faso, to characterise and investigate the inter-linkages between health consciousness and environmental consciousness, and their relationship with wealth. This is achieved by specifying sequentially three econometric modelling frameworks starting with a set of independent binary probit models describing each choice process, followed by a fully parametric trivariate probit model that accounts for choice dependency, and finally by a semi-parametric trivariate probit model that further relaxes the linearity assumption. Based on the Akaike information criteria and the estimated correlation coefficients, the semi-parametric trivariate probit specification describes best the observed consumption behaviours. The results show that increased wealth level raise households' health and environmental consciousness, while leaving the relative preference ordering over the services in the consumption basket unchanged. In fact, the ordinal ranking of the effects of wealth is consistent in size and direction across all wealth categories, with the greatest relative effect recorded for the choice of improved sanitation facilities, followed by that of wood-substitute fuels, and finally by that of improved drinking water sources.